Negative pledge clause

Definition:

A bond covenant that requires the borrower to grant lenders a lien equivalent to any liens that may be granted in the future to any other currently unsecured lenders.

Investing Essentials


Copyright © 2011 Campbell R. Harvey, Professor of Finance, Fuqua School of Business at Duke University

Term of the Day

Performance shares

Shares of stock paid out to managers only if the company makes certain sales, earnings per share, or other similar criteria.

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